I seem to have the same problem with my 2010 Venza where the pedal use to engage 1/4 of the way down and now seems to engage closure to 2/3rds of the way down. Brakes and Rotors are all new and fluid has been flushed. Master cylinder works and the booster seems to be working. I can't explain it. If the master cylinder was leaking your pedal would sink to touch the floor. Your booster assists with making the pedal easier to push, if it were failing the pedal would feel extremely hard to push.

The reason all the lights lit up was because you had a misfire and has nothing to do with your brakes.

I am still trying to determine why this is happening and will post once I figure it out.

 

I think I have figured it out. If your brake pedal still works but engages about 3/4 of the way down, I would have to guess it most likely is the Master Cylinder. I did a little research and the conclusion I have come to is that a bad master cylinder will cause the pedal to slowly creep more towards the floor when you press it (because it is leaking internally), then once it hits about halfway-3/4 way, it will suddenly firm up like a normal pedal because the primary piston is now hitting the secondary and you are now pushing it directly rather than via spring force.

I couldn't find a kit online to rebuild it, Toyota has a new part number for the Master Cylinder, it is 47201-0T021 for this Gen Venza. If you take it into the dealership for repair, they will rape you. Perhaps you can find a good shop in your area that might charge less. Replacing it is not that big of a job and could be done in about an hour or less and then a brake flush is a must where all the old fluid is removed at the wheels via bleeding.

Why this happened in the first place is anyone's guess. Perhaps Toyota had a run of bad seals in the Master Cylinders and some are still going and some failed prematurely.

Hope this helps.....

Edit: part number, etc.